Video: 10 CRO Truth Bombs That Will Change the Way You Think

by Sean Work

Last updated on July 16th, 2018

A few months ago we did a webinar with Larry Kim, founder of WordStream and legendary unicorn marketer. Larry has managed billions in ad spend, improving conversions on everything you can think of – from pay-per-click ads to paid subscriptions. I think it’s safe to say, that no one else on this planet has more experience in the “conversion trenches” than Larry.

With that said, it’s probably in your best interest to watch this webinar video. You might learn something! 🙂


Sean: All right. So today we’re doing a special webinar. We don’t do many webinars here at Crazy Egg but today we’re doing 10 Conversion Rate Truth Bombs That Will Change The Way You Think. And I’m actually really excited for this. Larry Kim is our presenter and you may know him from WordStream and he’s now with Mobile Monkey. I’m really excited to see what truth bombs he unveils.

We have a running hashtag for this webinar, #CrazyEggTruthBombs, so if you’re on Twitter you can follow on there. And my name is Sean Work, sorry, I should have introduced myself, I am the VP of Inbound marketing here at Crazy Egg and I want to discuss with you a couple of new features we released this year that are pretty exciting before we go in here. We released editor, which allows you to make changes with your website without knowing who to code or using a developer, you can simple just click on a text, edit and make a change. Which leads us to A/B testing which is our other feature we released which now you can A/B test those changes to see which ones performed best.

And finally we have recording which allows you to record visitors using your website, end-users, and you can see what they’re doing and maybe perhaps what stumbling blocks they’re running into, what buttons they’re not seeing or clicking on to help you kind of create a better user experience and perhaps test those out and see which versions performed better.

So these are really exciting features we released this year at Crazy Egg.

Larry: Hey Sean, just one other question. What was the hashtag for this event today?

Sean: The one we’re doing right now is back up here and it’s #CrazyEggTruthBombs and I’m going to type it in here to the chat so all of you can see that.

Okay. So yeah, we had a little bit of a technical hiccup here – starting here, we didn’t have the screen showing the right screen but now I’m going to switch the presenter over to Larry Kim and he’s going to blow your mind with 10 conversion rate optimization truth bombs.

Larry: All right. So here we go. Awesome. Thanks, Sean. And thank you everyone for coming today. We’re talking about 10 crazy CRO truth bombs that will forever change your life. And it’s been several years since we’ve done a webinar together so it’s great to do this again, Sean.

All right, so just kicking things off, once upon a time there was a magical landing page kingdom with a magical landing page princess who held a dark secret. And the secret was that her conversion rate was awful. It was like 1% or 2%. And sure enough, the king and queen of the kingdom sent out an official decree searching for a CRO who could help fix this unfortunate situation. And, the CRO guru showed up at the door step or at their drawbridge or whatever and he said something like this – I’m sure you’ve heard this before. Message me in the chat if you’ve heard this before. If you change one of these things like the button color, or the image, or text, or font, or space or whatever, sure enough, you’ll see a 5% increase in conversions.

And the thing about these little tests is that if you can get 3%, 4%, 5% gains per test and if you could do one test per week that will result in a lot of conversions overtime, maybe 1264% compounded over a 12-month period and boom, that’s kind of like the broken windows theory of conversation rate optimization if you will.

And the problem with this theory is it’s all a lie. What happens in reality if you start doing enough of these tests – the problem here is that the Gains’ system persists, so this is what typically happens, this is a very common scenario where you thought you’re doing n A/B test. And by the way, I know it’s not statistically significant or whatever. Trust me, this is a statistically significant test, you can do this with as little as 200 visitors, with as little as 5 conversations.

So we have plenty more visitors and conversions in this conversion A/B test here. And basically what happened was at the beginning of the first week A was a clear win6ner but then the early lead disappeared, it kind of faded way overtime much, much later than after the winner was already declared. And so the Gains, they just didn’t persist and when you got to like two-weeks out the looser became a winner. And if you’re not convinced of yourself, this happens all the time, it’s very simple. All you do is you take an A/B test that you’ve run where the margin is 3% better or 1% better or whatever. Just something where it’s kind of marginally better and just run the same test again.

And what I found is I can make A the winner and B the winner. Just by not even changing A or B, like keeping them the same thing. There’s this element of randomness here where things just kind of – it’s called variness, basically. So that’s kind of what we need to see in the vast majority of our A/B test here.

Furthermore, a lot of times these well-intentioned CRO efforts kind of just increase quantity of leads at the expense of quality. And when I mean by this is I’ve done work these companies where they’re patting themselves on the back by increasing their lead conversion rate from 2% to 5% to 9% to 18% only to see their percent marketing qualified leads show the complete opposite. So it’s where you go from 7% to 4% to 2% to 1% in terms of the qualification rates, MQLs. And again, let me just give you a simple example of this; if you were to have a form that had like a 100 fields then you would have a very slow conversion rate. But the one person who made it through would be super committed to buying whatever it is you’re selling.

And so a lot of theses, you’re just trading quantity for quality. A final issue here has to do with the fact that despite huge popularity in CRO and conversion rate optimization over the last decade, the average conversion rate today is still 2% and that hasn’t changed – this is over a decade. So whatever you’re selling it’s around 2% despite – you know, everyone is doing all this conversion rate optimization, why isn’t the average conversion rates moving at all. And so I think the issue here with our donkey CRO man was that the convention CRO wasn’t working, it was mostly smoking mirrors and outraged our king and queen of landing page land hired a private investigator to kind of get to a bottom of this mystery. And I am that private investigator that was hired by the queen and King of Landing Page land and basically I wanted to get to the bottom of – I was going to share with you my findings of this investigation. However, before getting into all the details I just wanted to introduce myself briefly.

I’m one of the National Unicorn Marketing association, debunking stupid CRO myths since 2008 and I just wanted to share a few random facts about myself. I originated from Canada. Canada; a couple of interesting facts; I’m from Manitoba, that’s kind of the polar bear capital of the world and moved to Boston about a decade ago because the weather was so much better. I lived in Harvard Square, it’s a very famous area in New England. It’s where Microsoft was founded, it’s where Facebook was founded, it’s also where I founded my first business WordStream about eight years ago working all by myself out of Panera Bread because I had free Wi-Fi  and unlimited diet coke refills.

The company today is huge, it’s employing over 200 people and managing a billion dollars of ad spend for over 10,000 customers worldwide and it’s doing great. And if you ever need any PPC help you should definitely check them out but a couple of months ago I left the company that I founded to start a new bot kind of mobile company And I have been working on this for a few months not.

So anyways, I don’t anything to show just yet but maybe one day. This last little bit of myself, I have a three-year-old kid and I’ve been blogging his life on the web at #PPCKID on Twitter. Here we are running the Marathon together. He was trying to help me out but actually he wasn’t really that helpful.

All right, enough about me, back to our great CRO conspiracy, 10 CRO truth bombs that will forever change your approach to marketing. Are you ready for this, Sean?

Sean: I’m ready.

Larry: Awesome. All right, so here is my number truth bomb which is to kill your calls to action. And I’m sure you’re thinking like, “What?” Calls to action, those are like the most important possible thing you could ever have in your campaigns. And you’re probably thinking like there’s even conferences named after calls to actions. You know, why on earth would you ever want to get rid of a call to action?

Here’s just some data that I shared a year ago and basically what we found that was doing a lot of email marketing – can you notice that these are or best performing email subject lines? Do you notice anything about these, Sean, at all?

Sean: Right off the bat I do see numbers tend to be helpful, perhaps, at the very beginning of the subject line.

Larry: They have no calls to action. So we eliminated all the buy now and we just went with some kind of emotional trigger just to spark curiosity or something. And basically the open rates went through the roof. You know, of these open rates can be as low as 4% or 5%. And basically the theory here is that maybe the advice around calls to action is kind of getting a little outdated. So you think back 15 years ago when the internet was kind of new thing and people didn’t know that if you click on a link you could buy the thing. And it’s like you need to put these buttons otherwise people will not know what to do. Well, it’s been a round for quite a while now and I think they know that you could buy this stuff, I think it’s kind of expected actually.

And so, as is the case with most best practices, they tend to kind of have a way of obsoleting themselves over time. And basically what I’m suggesting here is give your customer the benefit of the doubt that they’re not complete idiots and instead use kind of the limited real estate that you have to talk about your guarantee or your competitive differentiators or some kind of emotional trigger rather than wasting all the space on stupid, idiotic calls to action which should be obvious at this point.  That’s what we found works here.

Number 9 truth bomb has to do with raising your click-through rates will actually raise your conversion rates. And so I wanted to give you an example of this in practice. This ad here is a complete donkey, it’s breast cancer screening with early detection, survival rate is 100%, book an appointment today. So this was a typical 2% of 3% click-through rate and typical 2% or 3% conversion rates. What we did was we just changed the ad to dramatically raise the click-through rates. And so where’s the same company but it says “Brest Cancer Screening. Only 15% of women life 5 years with late detection. Get screened.” So now we’ve kind of created some real – this is perfectly factual, this is actually like a true statistic but we kind of needed a little more emotional triggers trying to kind of think in terms of the mindset of the person doing the search.

And this is a very compelling ad. And of course, this gets 3, 4, 5 times higher click- through rates and also gets 3, 4 or 5 times more conversion rates. Not only did it do well in the conversion rates, it generated a 125% more daily appointments being booked for this particular clinic and 170% increase in the call volumes. And by the way, calls are worth a lot more than clicks. The contact rate, all those leads you’re collecting – the contact rate decreases 21 times in the first 30 minutes. And so these calls, if you can just get them at the right time you’ll have a lot more chance of selling to them whatever the heck you’re trying to sell.

And basically, the key takeaway here is that the reason why there’s a connection between click-through rates and conversation rates is because if you can get people worked up enough to click on your thing, that excitement or that fear or whatever that emotion will carry through to a purchase or a lead. It will carry through to whatever it is you’re hoping for them to do. That excitement – they take it with them through the click.

I’m just going to stop here for a second. Sean, any thoughts or questions about your first two truth bombs?

Sean: Yeah, that makes a lot of sense. The only thing that came to mind in my end was if you do collect a lot of email base leads, the time you take to contact that lead is very, very important. There are a lot of studies that say that if you can actually call that lead within the first 5 minutes your chance of business success is almost the order magnitude sometimes.

Larry: Yes, it’s like a 100 times decrease in contract rate in the first 5 to 30 minutes which makes wonder like, why are we even collecting these things in the first place, you know

Sean: Anyone that has a sales team, that’s one of the metrics you really want to focus on.

Larry: Awesome 8 CR truth bomb has to do with remarketing. It really is CRO. Now, all of marketers consider remarketing as advertising but it really should be considered part of your CRO toolkit. The weird thing about remarketing is that the more times someone sees your ad the higher the conversion rate. So think about that; the more times you see the ad the higher the conversion rate is if you click on it. It’s almost like being nagged over and over and over and by the time you finally capitulate and you say okay I’ll buy the damn thing, you have twice as likely propensity to buy the thing over time.

And so that’s seems like a really interesting way to double your conversion rates here. So I’m thinking remarketing on Facebook and the Google network and also being very aggressive in terms of like don’t just remarket for like 10 minutes or something like that, if your sale cycle is a week on average, set the duration to 3x that duration so that you’re in their face so they don’t forget who you are. And don’t limit the impressions, just service much as aggressively as the ad platforms will allow you to do. And if you’re worried about ad fatigue, if you don’t want people seeing the same ad over and over just have multiple ads highlighting features or benefits of your products and services.

My number 7 truth bomb has to do with the impact of brand affinity and how that dramatically impacts conversion rates. To early on in my career as a marketer, I was led to believe that little changes that I was doing to my campaigns were having a dramatic effect on campaign results. So for example, in ad words I thought maybe I changed the match types it will increase the conversion rates. And sure enough, people like to take credit for things, they try to convince themselves that their hard work has paid off and  so there’s a natural bias I marketers to want to attribute positive results to their own actions. This is a bias.

But basically what I found was that most of the success or failure in conversion rates is already [pre-bait 0:019:15] it has a lot to do with whether or not the brand you happen to be working for has strong or weak brand affinity. So if you’re like the PBC manager for Nike, those campaigns are going to do great no matter how crappy your campaigns are because people have heard about this brand and if you’re just like an unknown brand, you’re kind of in trouble. So what I mean to say is we did a lot of experiments back when I was at WordStream last year, looking into conversion rates of new visitors versus repeat visitors. And what we found, it shouldn’t be that surprising although it is interesting to see it is backed with data is that people who are familiar with you or have visited your site recently were two to three times more likely to convert than the people who had never visited you before.

And this just tells me, you know, when you think about conversion rate optimization, if you’re trying to get these 1% or 2% gains from these different tests, and then there’s this notion of brand affinity increase in conversion rate by 2% to 300% as opposed to 2% or 3%. It really tells me this is the most powerful form of CRO is just to create a brand that people have heard of and trust and love because just doing that will double and triple the conversion rates. Any thoughts on those two, Sean?

Sean: Yes. So I know a lot of people are afraid of retargeting because they don’t want to hurt their brand image. So what do you suggest people do? Just go for it and not worry about it or wait till their brand is a little stronger before they flow heavily in retargeting?

Larry: Why would they be afraid of it? Is because they’re worried about the ads being placed on questionable sites?

Sean: More like it’s annoying to people to see or the creep factor of ads following you around the internet. They’re afraid of that.

Larry: I think the cat’s out of the bag on that one, Sean, remarketing is like a 10-year-old technology. I think people understand that their browsing history is going to inform ad targeting. And given that’s the case, I think – basically, I think marketers think about this more than your average consumer, I don’t know, for reasons that don’t necessarily make much sense to me. Maybe I’m trying to convince you here with this truth bomb.

Sean: No, I actually agree with you to go for it but I just some people that do say, “Gosh, it’s so creepy to see this ad follow me around the internet.” And I collect that anecdotal data just to kind of, well, keep that in mind.

Larry: Well, wait till you see what other technologies we have that are substantially more creepy because I feel like –  Britney was kind of shocking 15 years ago and now there’s all these other people. The same idea with ad targeting, we’ve come a long way since this vanilla remarketing and we can talk about that a little bit.

So my number 6 PPC hack has to do it RLSA which happens to be the most boring name in the world of the most powerful Adwords technology in the platform. So RLSA stands for remarketing lists for search ads. And basically this is a search technology where rather than targeting everyone who’s searching for the keywords that you’re interested in targeting, it’s showing those keywords to people who have visited your sites recently.

So what’s interesting about this is you’re cherry-picking – remember we’re talking about new visitors versus repeat visitors, it’s like comparing donkeys and unicorns. We talked about people who have visited you recently have 2 to 3 times higher click through rates and 2 to 3 times higher conversion rates. So here’s the same research being done on new and repeat visitors based on click through rates. And remember, higher click through rates yields higher conversion rates. We talked about how – like, if you can get people excited about clicking on something that excitement would carry through to a purchase.

So the only thing about this is there’s so much leverage in this strategy, like, the higher click through rates actually result in substantially lower cost per clicks. This is the case on all the ad platforms including Facebook, Twitter, Google Adwords, YouTube, etcetera. The higher the click through rates, the less you pay. And so when you’re using remarketing list for search ads as opposed to just vanilla search ads, you have the potential here of tripling those click through rates which in turn cuts the cost per clicks in half and triples the conversion rate because you’re going after the people who’ve heard of you before.

The problem with the RLSA is just audience size, it’s generally the case that there’s more people in the world who haven’t heard of you than who have heard of you. So you’re kind of cherry-picking kind of the best possible customers as opposed to just creating new customers out of thin air which is not usually as easy to do. It would be like planning a sporting game where you you’ll only have defense and no offence, something like that. You have to balance your marketing efforts between harvesting demand versus creating demand.

And so the idea here, the hack is to combine the power of RLSA which is really great for harvesting demand that you’ve created with the power of SEO and content marketing in order to kind of have your cake and eat it too. So here’s kind of a graph of what we’re talking about here, Sean. Hopefully you can follow this. Remarking list for search ads is going after that dark circle. Those are the people who are familiar with your brand. That’s kind of the low-hanging fruit.

The problem is that there’s so many more people who aren’t familiar with your brand. But what you can do is you combine the power of social and search ads to make the smaller circle much, much bigger like a hundred to a thousand times bigger by doing PR stunts or content marketing stunts or social media ads to just get your brand in front of people so that creates that familiarity which is what makes RLSA works so great.

A couple of other ideas here, if you happen to know that your target audience is not just based on a keyword search but is also based on an identity, like, if you’re selling audio speakers, you’re actually more likely to sell these hi-fi speakers to males and they’re still a little bit older, maybe like 30, 40, 50 years old and maybe not – 65 years old because by then you’ve lost your hearing or something. I don’t know, I’m just kidding.

But the point is these search technologies used to be all about going after everyone who searches for a certain keyword but everyone is not a target market, only one or two percent of these people will convert. And so if you think about the definition of conversion rate, it’s how many who converted divided by how many who clicked on it. And so you can raise the conversion rate by two ways either by increasing the conversions or by lowering the clicks, by being more picky in terms of kind of screening of the people who aren’t going to buy in the first place. So by layering in these things – and this is what I call SUPER-RLSA. If you’ve never heard of that that’s because I implemented this. It’s basically you’re combining remarketing because that means they’ve heard of you with layering additional demographic qualifiers as well as the keyword search. So you’re getting people who are kind of ready to buy now who are qualified buyers who have brand affinity. And if you can do this, that’s basically unicorn marketing. Any questions on that one, Sean?

Sean: No, that’s exactly what you wanted to – anyone that’s working for a known brand or big brand then you obviously need to get on this.

Larry: Or if you don’t have a big brand it is upon you as a marketer to engage in certain types of marketing activities that will –

Sean: Increase the brand.

Larry: Which will create the awareness and the demand for the products.

So number 5 we’re talking about creating off-topic content. So what I mean by this, I’m sure a lot of the people on the phone today are kind of content marketers and, you know, the conventionalism when it comes to content marketing is to stick to a niche and to own that niche. So like for myself I was an Adwords guy for like 5 years. I would write 3 piece on Adwords every week for five years. And that’s that kind of a conventional success criteria, is to stick to a niche, become the expect in that field.

But what I’m telling you here is a really fantastic CRO strategy is actually to do the opposite which is to go off-topic and to go after users to try to get their attention long before they ever start searching for the products and services in your niche. So how does this work? So basically, what I’m talking about here is using the power of these new analytics tools, like a Google Analytics user explorer. So it’s kind of looking at the people who are visiting your sites and it’s tell you what are their affinities? What are their in-market segments? What are they actually looking to buy, what do they love to consume, etcetera?

Facebook has this really great tool called audience analytics, the audience manager here. And what this does tell you what is the population of certain types of demographics and interests amongst your audience and compares that to what does it look like for the population of Facebook as a whole? Tells you what their education level is, what their relationship status it, etcetera. Even Twitter analytics has remarkable insights into what are their interest of the people who are following you and engaging with you on Twitter.

And so the reason why that’s so valuable is because this tells me that if I want to get in front of my target customer to build that brand affinity before they start searching for certain marketing solutions or whatever, I need to be blogging about entrepreneurship and business news and technology news. Because look at this insight here, it says 70% of my audience is into entrepreneurship and that makes a lot of sense. And so that’s one of the reasons why a few years ago I actually stopped blogging exclusively about these kind of really dorky algorithmic PPC hacks and kind of took it up a little, if you will, and started talking about just general business issues. This is to create a bias amongst my target audience long before they ever decide to buy mobile marketing solutions or Adwords solutions.

And it also has the benefit of being a substantially larger niche. So I can cast a much larger net. I’m not suggesting that you go crazy and just abandon your niche and just write about hot garbage. But what I’m suggesting is from time to time it helps through some cover analytics. If you know that there’s certain topics that are very interesting to your audience, do some marketing in those interest areas because those are likely to become your customers in the future. Any thoughts about that one?

Sean: Yes, I totally agree. Definitely spend time on all your analytics dashboards and kind of just get a cup of coffee and look at the interesting insights that you see because you might come up with these great content ideas.

Larry: Basically what I’m suggesting is you create content in the area of greatest common overlap between what your users are interested in consuming and what you’re capable of speaking to with authority. So my customers might also be interested in celebrity gossip, but I just don’t have the authority to say anything interesting there with any amount of credibility. But the biggest area of interest amongst my target audience that I could speak to with some credibility being a business founder here was this notion of entrepreneurship and technology and productivity. And so that’s kind of what I’ve done here.

So just thinking about how marketing really works, it’s really simple. You’re creating an inspirational memorable content about your brand and getting that in front of this target market. People then see the ad or the content. It doesn’t have to be an ad, it could be a blog post. They then basically – they’ll see it, they don’t necessarily take action or buy your stuff right away but in the back of their head, though, from a bias, and they’ll start thinking happy thoughts towards your company or your identity. Later when the need arises, people do one of a few things; they’ll either do a branded search for your stuff because they remember you, in which case you’ve won, because they’re looking to buy your stuff or they’ll do an unbranded search for the product or service that you’re selling but when they see that search they’ll be kind of biased towards choosing you and buying from you because they’ve heard of you before. So that’s kind of this works.

My number 4 truth bomb has to do with creating stronger biases with video ads. We talked a little bit how marketing works and it’s all about getting that content in front of people and making sure they remember it, like the Gieco lizard or whatever, the gecko, very memorable character. And so the strongest way to create these biases is actually using video ads. It’s not only more memorable but because of these ad platforms like Facebook, they reward high engagement contents, so contents with high click through rates and high engagement rates with very low cost per views. So this is like a 2 cent cost per view. It’s kind of a perfect storm. You get more brand recall at a lower cost. And this is like a stupid video that I did a little while ago. You don’t hear the sound for this, do you?

Sean: I hear some squeaking.

Larry: Sorry.

Sean: Yes, a little. We hear it faintly.

Larry: So this is ridiculous. Did you see that video? It was like a donkey getting zapped by a lightning bolt and turned into a unicorn and then jumping into a rocket ship and blasting off into space. Holy smokes, that was crazy, it’s so hard to unsee. And this kind of stuff is how marketing works. Next time you think of a unicorn you’ll probably think of me or one of my companies here. Chances are people from all over the world send me unicorn crap because – like I’ve got unicorn masks and unicorn ties and all sorts of items every week because of the brand affinity. And all the free stuff is a nice little perk. Just kidding, I do appreciate any unicorn things, if you want to send me anything.

And number 3, we’re almost at the end of this, we’re talking about eliminating your landing pages. So why the heck would you ever eliminate your landing pages and the reason is because they’re kind of obsolete. All these new mobile technologies kind of obviate the need to get people to click through your website in the first place. And this is an example of a lead capture ad in Facebook where they’re submitting their contact information to without ever having left the platform. And the pricing for this ad format is cost per lead-based rather than clicks. The problem with buying clicks is that if only 2% or 3% of them are converting, that means you’re buying 50 to 33 clicks for every lead. You see what I’m saying? It’s just much more economical here if you can buy by the leads.

Were basically eliminating an entire stage of the funnel here. Like, why on earth would you send people to your website if you’re losing 90% of them, like if 90% of them don’t give you their information instead, like these call ads and these [lose lead] formats, you can kind of eliminate that leaky bucket all together. Any thoughts on either of those, Sean?

Sean: Do this.

Larry: All right. So we’re down to my number 2 CRO truth bomb today and that is to change your flow. So what do I mean by changing your flow? So this is like a decade ago, I was working for a software product company that was doing desktop software and the desktop software you had to go to a website and register for a software key to unlock the desktop software, I’m sure you’ve done that before where you just register for the software. We did one change with this set up, we made it so you could download the executable directly from the website but the last stage of the installer then kind of held you hostage. It said, great, the final step of installing this thing is just to enter your registration key and you can register rather than having them go to a website we just had them register for the thing in the software application right here, it was a pop-up.

And basically that was just by changing the flow for kind of asking for the key at the beginning versus asking it like 5 minutes into the – you have to download the thing and then run the installer, you’ve already invested 2 or 3 minutes into this process and you’re kind of asking at the last stage here. Your kind of anticipation is building and all these stuff and finally popped the question here. This triples your conversion rate. So just thinking about where you want those – they’re called turnstiles. And putting them later on in the experience can have a big difference.

So my number one CRO truth bob for today is to change your offer for insanely awesome CRO. And this is actually the biggest and most important lesson for today. And the thing here is like, back when I was at WordStream we did all these research on donkeys and unicorns. Donkeys being kind of the average marketers and they would have thee crappy offers that would convert at around 2%. The top25% of advertisers had stuff that was converting at 5% and the top 10% of advertisers were doing 11.45% and above. So there was this pretty diverse spectrum of really, really crappy to really great distribution. It’s almost like this notion of – it’s called the power law, like the richest have all the money or your talking points do substantially better than all the other campaigns together. And just recognizing there is such a difference between – no matter what industry you’re looking at. So even if you segment by, like, finance or real estate or whatever, the top 10% of offers do roughly 5 times better than the average donkey.

And so the key here is not necessarily to try to put lipstick on a donkey but rather is to change your offer, right? So how do you convert your donkey offer into a unicorn? Let me give you an example. This is an ecommerce example of a customer of WordStream that had thousands of products in their catalog. Some of these products had a very, very crappy click through rates, like 0% or 1% or 2% click through rates and they were converting awfully, like half a percent or 1%. Others had a substantially higher click through rates and were converting at substantially higher conversion rates. You see what I’m saying?

And so what I’m saying is that in that product catalog there were really great products and there were really donkey products. There was crap stuff like picnic pants which is the worst product in the world. It’s basically eating off your own couch and why the heck would anyone want to buy something like this? It’s crazy. And that’s an example of an offer that has a very, very low click through rates and very, very low conversion rates. What you want to do is stop selling the damn picnic pants and instead sell something that’s more interesting like drones. Drones, by the way, are the coolest thing ever and if you’re looking for a gift idea for a good friend or a husband I highly recommend the DGI Phantom IV.

And basically the worst thing that we can do is put lipstick on a donkey so this is kind of what a lot of CROs actually believe, that if you could just buy one picnic pants, get one free or triple the size of the buy buttons or kind of get better photography. Somehow, this is going to yield better results. But it’s this lipstick on a donkey, you’re still selling these stupid picnic pants which is the just most awful thing ever. Even if you do succeeding in creating the perfect picnic pants, buy now page with all the right colors and everything, you’ve summited the donkey hill, you congratulate that you’re king of the hill but that hill is donkey hill.

What you should have done is – with the theoretical, it’s never going to get any better than 1.5% conversion rates. What you should have done is just abandon that quest all together and just try to find something better to sell an something worth summiting, something worth where you do become the victor of that space that is actually worth something, unicorn hill.

And I just wanted to give you an example of how you turn picnic pants into a drone from my own life. So once upon a time, 6 or 7 or 8 years ago when I started WordStream, the offer that we were trying to get people to do was a free trial of the software where you would fill out you name and all this stuff. And at the end of this registration process you would get to try my software. And why did we do this that way? The reason was because we’re a software company and that’s what was expected of software companies, that you’re selling software, you should just give a free trial.

And we did that stupid thing where you add videos and change the benefits and change the headlines. And it did nothing, our conversion rates were like a donkey conversion rates for 2, 3, 4 years. Then one day it occurred to me, like wait a minute, why do I keep sending people to this donkey offer even though it has like a 2%, some donkey conversion rate. Basically, if you have a low conversion rate, the universe is telling you that the thing that you’re trying to sell isn’t that interesting.

So I took a cue from the universe and said why don’t I try something different? And so I took a team of three engineers and we built this WordStream Adwords performance grader in 90 days. And all it was is rather than trying out the software, it did an evaluation of your Adwords. And by the way, this is a really great offer you should try it out. It’s It will give you a free report card of how you’re doing. It will say, like, “Oh, that agency you’ve hired haven’t logged in in six months.” Or they’ll tell you what your click through rate is and if that’s any good or not. Let’s say you’re on the bottom 30th percentile or whatever. So we just change it so they don’t have to do any work, it just gives you a free report card. That 10x the conversion rate, not 10%, 10,000% change.

And when you do these fundamental changes like selling drones versus selling picnic pants this is the one case where the gains actually stick because you’re offering something substantially different.

One other crazy example, when I started the company 8 years ago we started out a free keyword tool. It sound like a great idea but it had a low monthly price, had a pretty bad customer lifetime value. And what I could have done is I could have just kept on pushing this rock up a hill and becoming kind of the greatest keyword in the history of man. But maybe that has like an 8-month customer lifetime value. You see what I’m saying? Like, what do I do when I win that market? And instead what we did was we basically pivoted to selling something a little more valuable with substantially better business characteristics. So the leverage here is less about just dressing up these donkeys but rather converting the donkeys into unicorns.

And basically, we’ve been talking a lot about conversion rate optimization and what does it all mean. Well, here’s kind of the map from donkey land to unicorn land. We talked about kind of creating and promoting content to your target market on the cheap in order to create these biases in people’s heads and grow your brand. We talked a little about promoting video ads because they’re even memorable and tagging people with cookies and remarketing the heck out of them so that they remember who you are. We’re talking about how remarketing can then turn those bias users into customers.

But in converting them, consider eliminating the landing pages and changing out your stupid offers with something radically different and radically better. And that is kind of my take on unicorn CRO. Three types of categories, if you think about all the 10 hacks we talked about today; there was one that were kind of on-page elements. And you see how kind of this baby unicorn. Those are important but I feel they’re kind of like the weakest of the group. They’re a bunch of hacks related to brand awareness where we kind of get people to have irrational happy feelings about your brand and your products and that has tremendous – 2 to 3 times or 200% to 300% increases. And then the ultimate growth hack the reengineering whatever it is you’re selling to be so much better than something that’s converting at 2%. And this has the impact of not only raising the conversion rates but also the sales.

But I’m not saying any of these are not important but just focus on all three areas. I think a lot of companies tend to focus on one exclusively. So any thoughts on this, Sean?

Sean: Yes. Sometime comes to mind. I’m sure there might be people in the audience that believe their product is a donkey, they work for a company that makes donkeys – they work in a donkey factory. What do they do? Quit? Or do they go and confront upper management and make the changes and be the leader of change in the organization?

Larry: Wow. I would do that, obviously. Intuitively, it’s kind of obvious. If you have been trying 101 different things to sell your crap product and it’s still converting at 1% or 2% it’s a little delusional to believe that sending out this offer to even a thousand more people is going to somehow change that reality. You know what I mean? If the first thousand people didn’t like it what will make the next thousand like it?

Sean: Yes.

Larry: But yeah. That is how this companies operate. They don’t think about the leverage of doing something different, it’s always about pushing stuff harder.

Sean: Beating a dead donkey.

Larry: Yes, beating the dead donkey to death. This is like the donkey zombie is already dead but let’s keep beating it. I would quit, that’s what I would do. I mean, would you rather work for a company that has a lot of great brand affinity with the products that have great – wouldn’t you rather work for Uber, the Taxi Company?

Sean: It could be a good company, but they just need to see the light. At least the first attempt is to try to help out and suggest and get advice and see where that goes.

Larry: So just wrapping up our fairy tale CRO story today, the Landing Page Princess decided she didn’t need prince CRO charming. She ended up becoming a growth hacker and brand builder and this resulted in ridiculously great conversion rate optimization. The CRO donkey was banned from the kingdom.

Just be careful of these CRO donkeys, they’re just awful. They’re just flipping coins, basically, and thinking that they’re going to add up to something and they never do. I used to think that the CRO stuff was a big deal but it turned out to be mostly variants. The things that matter are the ones were you’re seeing 200% to 300% changes. Like when you have brand affinity it’s not a little bit better, it’s 300% better. You want to be chasing after the big things, not the little things and being a unicorn in a sea of donkeys.

So Sean, thanks so much for having me. Do we have any questions from our audience today?

Sean: We do. How much time do you have for questions?

Larry: 10 minutes.

Sean: By the way, there’s a questions box in your control panel, audience, so go ahead and throw in a question of you have one for Larry. The first one is for a company with 10,000 MMR, how much would you be spending for Adwords?

Larry: It’s not about the MMR per say, it’s about on a unit economic basis. So for that one new customer how much of that revenue is being spent on marketing. So CrazyEgg gives – what’s your price there, Sean, for monthly stuff?

Sean: $29 a month.

Larry: So I’m not going to put you on the spot here but let’s just say the average customer lifetime for this was 2 years, I don’t know if it is or not but we’re just going to market his up. That’s 24 months. So that means that if you take $29 a month x 24 months a quick math tells me that’s around $700. A customer lifetime value of $700. So a rule of thumb says not more than 30% of that profit – that $700 – should go to marketing because marketing is like sales and marketing. So a third of $700 is around 250 bucks.

So Sean, I hope you’re not spending more than 250 bucks to acquire these customers otherwise you would be spending way too much on marketing and not paying for your developers, and not paying for your administrative cost or your offices. There’s other costs associated with the business. All right, next question.

Sean: Please go ahead and throw in a question or two in your questions box if you have any for Larry. This is a great opportunity to get some expert advice.

Anything else you want add, Larry?

Larry: Just thanks for coming out, guys, and I think that CrazyEgg is a great company and if you’re in the market for this kind of heat tracking analytics software I recommend you check them out.

Sean: Thank you. And please follow Larry, we’re going to put his Twitter here in the chat box, he’s a wonderful guy to follow on Twitter and know what he’s up to. And tell us a little bit more about Mobile Monkey before you go.

Larry: It’s this early stage stuff. Jumping on the mobile or and AI and machine learning chatbot bandwagon. I’m following my own advice here of trying to pick an exciting thing.  It’s still in the early stage, though. And if you message me I can add you to the list to get updates on stuff and if and when that stuff becomes available.

Sean: What’s the best way for them to connect with you?

Larry: LinkedIn is the best because Twitter I just have nearly a million people on that and it’s just such an awful way for me to comunicate I’ll get like 4,500 notifications or more.

Sean: Okay. That’s impossible.

Larry: So there’s a good chance that I’ll miss whatever it is you’re trying to send me.

Sean: All right. Okay, audience. Thank you so much for coming today. Thank you, Larry. That was great advice, I’ve learned a lot just from watching this. And we did record this and I’ll be putting the recording up probably about next week after we have it edited. Until then if you have any question you can reach out to me, again my email is It’s pretty easy to remember. So feel free to message me.

All right, guys, have a great rest of the week.

Larry: Awesome. Thanks guys, bye.

Sean: Bye.

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Sean Work

Between rocket science and space shuttle design at Boeing and NASA to building the Kissmetrics blog to 1 million monthly readers, I’ve also helped dozens of online businesses with PPC, SEO, and Conversion Rate Optimization. If you have any questions about generating success online, write me a question now at


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